Vaccine effectiveness (VE) estimates can vary widely between years and populations, even for the same vaccine. Estimated VE is known to be sensitive to susceptible depletion and differences in pre-vaccination infection risk between vaccinated and unvaccinated populations. However, how variation in pre-vaccination risk within and between the two groups affects VE estimates over time remains unclear. This uncertainty is especially important given negative VE estimates. We investigated the difference between estimated VE and true vaccine protection considering continuous distributions of pre-vaccination infection risk under three scenarios. When the vaccinated and unvaccinated populations differ in their mean risk, estimated VE can be higher or lower than true vaccine protection. Similar patterns arise when both populations share identical means but different risk distributions. Finally, if infection-derived immunity lasts longer than vaccine protection, annual VE estimates can vary by tens of percentage points between years despite constant true vaccine protection. These theoretical results underscore that VE studies estimate contrasting risk between vaccinated and unvaccinated individuals in a particular time and place, and VE estimates can vary counterintuitively between years and populations even with constant vaccine-induced protection. Explaining variability in estimated VE thus requires a more complete understanding of populations' distributions of infection risk.